HMRC Dept (Bankruptcy)

I agree that we are too fixated with the idea of home-ownership in this country however I think we have to let people make their own decisions and deal with the consequences. There will always be genuine bad luck stories and one would hope there were sufficient fail-safes and back-ups to assist most people in those circumstances; although clearly not every case will be adequately covered.

We also need responsible lending which, quite frankly, we did not have in the late 1990s/early 2000s, when vast sums were lent to people who simply could not really afford to repay them if their circumstances changed. We are seeing the legacy of that now.

Advice I give here is free, without liability on my part. It is not a substitute for formal advice.

Agreed, Cyndy. We need to look at providing affordable town-centre flats as you see in French and Spanish (and I believe German) cities, where people actually live near offices, shops, restaurants etc. This will help breathe life into some of our tired old towns and city centres (e.g. Wellingborough, where I live), and stimulate B to C businesses in those areas.

Advice I give here is free, without liability on my part. It is not a substitute for formal advice.

We also need responsible lending which, quite frankly, we did not have in the late 1990s/early 2000s, when vast sums were lent to people who simply could not really afford to repay them if their circumstances changed. We are seeing the legacy of that now.

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I agree, however we now have responsible lending which is pretty much universally condemned - including by politicians and media

I agree, however we now have responsible lending which is pretty much universally condemned - including by politicians and media

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Quite.

The current situation regarding the availability of mortgage finance is not much diferrent to that when I bought my first house in the early 1980s. I had to save up a deposit of 15% and could only borrow 3 times my gross earnings.These conditions to me seem responsible and quite normal. What has happened in the interim is the aberration.

The diferrence of course, is that my first house cost £17,000 and the same house today would be marketed for around £150,000. Earnings have not increased by anything like as much as house prices.

Only an idiot could come to the conclusion that more availability of mortgages is the answer. Irresponsible lending was the main cause of the explosion in house prices to their current unsustainable level. A return to sensible price:earnings ratios is essential, and this can only be achieved in the long term by static prices while earnings catch up, or in the short term by a crash in house prices akin to what has happened in Ireland, Spain, and parts of the USA.

The emergance of the 'But To Let' mortgage has been a major factor in compounding the problem. Historically residential mortgages were offered to potential owner occupiers by mutual building societies. The builing society was the innovation that facilitated the massive rise in home ownership in this country in the 20th century and formed our culture as home owners. Unfortunately the Thatcher government saw fit to destroy the building society movement and gift the mortgage market to commercial banks who operate without any eye on the social consequences of their actions.

The Buy to Let mortgage had been a total disaster for the housing market. Small houses - the very properties that young first-time buyers have always bought as a starting point - have been targeted by avaricous amateur landlords like the OP's parents causing prices to rise out of the reach of a whole generation of ordinary working people. They are forced to pay rent to these parasites instead of being able to fulfil their dreams of owning a modest home of their own. Of course, once you are trapped in the private rental prison, saving for a deposit becomes even more impossible!

I've got several more pages of this diatribe to go but I've got to get to work!

Last edited: Nov 14, 2012

If you have a question or are seeking advice on insolvency please start a thread on the forum and alert me to it via PM.

I agree that there is no obligation to lend where the figures don't stack up; and as you say, a lot of funding applications are poor and lack commitment from the directors; however I have heard a large number of tales from accountants and business owners themselves that lead me to believe that there is an unwillingness on the part of banks to lend unless the risk is totally taken out of the equation. There needs to be balance.

Advice I give here is free, without liability on my part. It is not a substitute for formal advice.

I agree that there is no obligation to lend where the figures don't stack up; and as you say, a lot of funding applications are poor and lack commitment from the directors; however I have heard a large number of tales from accountants and business owners themselves that lead me to believe that there is an unwillingness on the part of banks to lend unless the risk is totally taken out of the equation. There needs to be balance.

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Alan

I agree that mainstream banks are unwilling and unable to lend freely

- Unable because the much publicised bailout only gave them sufficient capital to be 'legal' certainly not spare resource to lend

Unable because the latent bad debt situation is huge - potentially disaterous, so they have to retain reserves and keep risk to an absolute minimum.

There are, however, many sources of non-bank finance who will lend in the right situations.